Comptroller Susana Mendoza continues borrowing push to pay bills
The good news is Illinois' bill backlog is about $400 million less than it was about two weeks ago.
The bad news is the state's bill backlog is still more than $14 billion and there's not enough revenue coming in to eliminate the debt.
That's the message Illinois Comptroller Susana Mendoza gave to the Arlington Heights chapter of the National Active and Retired Federal Employees Association Wednesday afternoon.
Mendoza continued her push for Gov. Bruce Rauner to exercise his ability to borrow up to $6 billion to pay off a portion of that debt and keep the state from having to pay costly, self-imposed interest fees. Mendoza said at least $800 million of the state's current unpaid bills are due to interest owed for late payments, and the fees continue to grow by $2 million a day.
By borrowing, the state would expect to pay up to 6 percent on that debt paid back over 12 years, she said. The interest rates on the late unpaid bills are 9 percent to 12 percent.
Mendoza called the borrowing plan a "common-sense" solution. The Democratic comptroller joked that maybe she should publicly oppose the borrowing plan to get the Republican governor to support it.
"I don't know if I should start using reverse psychology," she said. "This should not be a fight."
Rauner's camp has said that paying down the state's unpaid bills is a "top priority" but that the state shouldn't take on more debt.
Mendoza has the authority to use $600 million to pay down bills immediately, using fund transfers and inter-fund borrowing, a spokeswoman for Rauner said.
"The comptroller should act now," Rauner spokeswoman Laurel Patrick said. "We have worked cooperatively with the comptroller to achieve this critical first step, and ask that she take action to help the state."
The state passed its first budget in over two years last month. It calls for $36 billion in spending. The budget included a 32 percent hike on the state's income tax rate to generate $5 billion more a year, but it also included $3 billion in cuts, Mendoza said.
James Glover, president of the local National Active and Retired Federal Employees chapter, urged members to vote when legislative and statewide offices are up in 2018. "People have to take responsibility for the decisions they make," he said.
Mendoza, a former state legislator and Chicago city clerk, defeated Leslie Munger in November for the two years remaining on former Comptroller Judy Baar Topinka's term. Topinka died shortly after winning the 2014 election, and Rauner appointed Munger to replace her. State law required a race in 2016 for voters to decide who would finish out the second half of Topinka's term. Mendoza said she plans to seek re-election in November 2018.